A partisan stalemate in Washington, D.C., has left one of Maine’s largest industries in limbo.
Farmers across the state are anxiously awaiting resolution on the so-called Farm Bill, which was stalled in Congress during the last session and won’t be addressed until a lame-duck session after the election, or in January, after new lawmakers are sworn in.
Jon Olson, executive secretary of the Maine Farm Bureau — a nongovernmental group that lobbies on behalf of agriculture — said the holdup in Congress affects all Maine farmers, but dairy farmers are in the worst spot.
The Farm Bill — a massive hodgepodge of laws that regulates the agriculture industry — expires today with nothing to take its place. The bill, which is renewed every five years, includes loan guarantees for farmers, land conservation programs, agricultural research, forestry and much more. A summary of the bill spans 17 pages.
The bill also pays for the nation’s food stamps program — which comprises 80 percent of the total cost to taxpayers. Not surprisingly, food stamps are at the center of the partisan squabbles.
Dairy farmers are bearing the brunt of the industrywide uncertainty because the federal subsidies that support them during tough times are now gone and nothing new is on the horizon.
It couldn’t come at a worse time, because dairy farmers are beseiged by soaring prices of grain and fuel. Farmers now sell their milk for substantially less than what it costs to produce.
“The frustrating thing about the Farm Bill is that people know there’s an urgency to pass it, but it never comes up for a vote,” Olson said.
In Maine, there are more than 300 dairy farms — all of which are family owned, said Julie-Marie Bickford, executive director of the Augusta-based Maine Dairy Industry Association. About 1,400 Mainers work on dairy farms, and another 2,600 work in dairy processing plants, cheese companies or other dairy-related businesses.
Bickford said the dairy industry in Maine and elsewhere suddenly is working without a safety net.
In late August, a federal program called the Milk Income Loss Contract expired, never to return. The program included a provision to help offset high grain prices for dairy cows, called the “feed adjuster.”
The industry was concerned about the loss of the feed adjuster, but fears were tempered by new provisions in the next Farm Bill that would include assistance akin to the feed adjuster.
Earlier this month, however, when it was apparent that Congress would enter recess without passing the bill, industry leaders pleaded for Washington’s help. Maine’s four-member delegation, along with more than a dozen other lawmakers, signed a letter to urge colleagues to extend the measure.
It didn’t happen.
“We’re caught in the cross hairs,” Bickford said.
The dry weather last summer in Maine and throughout the country resulted in low yields of grains and higher than normal prices. It now costs Maine dairy farmers up to $28 to produce 100 pounds of milk, for which they’re paid about $18, Bickford said.
“Nobody ever imagined we’d see $8 for a bushel of corn or $4.30 diesel,” she said. “MILC (Milk Income Loss Contract) was the only program out there that recognized our input costs.”
Dale Cole milks about 85 cows on his farm in Sidney and serves as board president of the Maine Dairy Industry Association. Cole loses between $3 and $4 for every 100 pounds of milk his farm produces.
“The feed adjuster wasn’t perfect, but it was better than nothing,” he said.
In other industries, production of goods generally shuts down during periods when costs exceed revenue. In the dairy industry, however, there’s no such thing.
Cows need to be milked — twice a day, every day — and they need to eat.
To sustain operations during tough times, Cole defers costs wherever he can.
“We survive by not replacing equipment, and cutting back on things we shouldn’t,” he said.
Prudence Flood is part owner of Maine’s largest dairy farms — Flood Brothers in Clinton. The farm boasts 44 employees, 1,500 milking cows, 3,800 cows in total and 7,400 acres of feed crops. She said the operation is too large to qualify for the feed adjuster, except for a few times a year. Regardless of farm size, fortunes are down everywhere in the industry, she said.
Flood Brothers has been losing money since April, when the cost of milk dropped by $6 for every 100 pounds produced. Since then, the price has risen, but so have costs. Even if prices even out soon, Flood estimates it will take a few seasons before the farm recoups its losses.
She wonders whether other farms will be so lucky.
Evolution of a stalemate
Food stamps, or nutritional assistance, have been included in the Farm Bill since the 1960s, said Russell Libby, executive director of the Maine Organic Farmers and Gardeners Association. Until now, the marriage of the two seemingly disparate issues was a good thing.
Fifty years ago, the U.S. population was divided evenly between rural and urban areas. To get urban politicians on board with the Farm Bill, the food assistance program was added, Libby said.
“There was a de facto agreement that the urban interests would support the farmers as long as the farmers’ rural interests would support providing better food to low-income people in the cities,” he said. “It’s been part of the big political calculus ever since.”
In the 1960s, however, food assistance came in the form of food, not stamps.
“It was surplus commodities,” he said. “Back then, in the pre-food stamp era, it was extra chicken, peanut butter and things like that — in big, 5-pound cans — that would go to poor people. So that was an easy one for the rural folks to buy, because their extra stuff was going directly where it was needed.
“But this year, the agreement is falling apart because there’s such a strong voice in the House to cut the food assistance program that it’s preventing the rest of the Farm Bill from moving forward. You have the fiscally conservative voices in the House who, in a sense, are voting against their constituents — the rural interests — in the interest of the budget.”
Libby predicted this Farm Bill might be the last that commingles agriculture and food stamps, but dividing them could have consequences. Urban areas are now home to two-thirds of the U.S. population.
“You need a chunk of those votes if you’re going to pass a bill in the House,” he said.
Cole said he would like to see the Farm Bill and food stamps addressed in separate bills, “but that’s probably wishful thinking.”
“When you start mixing it all together like that, it’s hard to come up with solutions, because there are so many moving parts,” he said.
In the meantime, Bickford said she hopes Congress will extend the feed adjuster as soon as possible.
“I can’t say that all the problems would go away if that were in place, but anything is better than a system where farms go into the red every time they milk the cow,” she said. “We’re on a knife’s edge. We still have enough farmers operating to sustain our milk processing plants and the agriculture businesses that service us; but if we lose too many more farmers, we risk losing those other elements.”
Ben McCanna — 861-9239